Tuesday, October 31, 2006

Taking Profits At Resistance

We were able to book a nice profit at resistance today.  A weaker than expected consumer confidence report helped push the euro to 1.2767 against the US dollar.  The pair is once again consolidating before the next big move.

Looking To Scalp A Few Pips

We will go long at 1.2701 to capture a few pips.

Consolidation

The EUR/USD pair has bounced from our support level at 1.2678 and more weakness is possible.  We'll watch for more range trading until we see another breakout.

Thursday, October 26, 2006

Euro Moving Higher?

A sustained break of resistance during the Tokyo session has technicians eyeing a push higher for the EUR/USD. Yesterday’s dovish statement from the FOMC also has added fuel to this fire. We will look to buy on dips today in anticipation of our next target at 1.2747. We consider rethinking our strategy if 1.2650 fails to contain the pair during the New York session.

The Fed Effect

Today’s announcement from the Fed my have left a number of folks scratching their heads. As expected, the fed funds rate remained at 5.25% for the third straight meeting. But the statement accompanying the announcement gave little evidence as to which way the governors may be leaning. The end result was a spike in the EUR/USD which was not able to penetrate resistance. Those following the Institutional Forex System were able to book a maximum profit trade.


It appears that the pair is respecting resistance at the 1.2620 area. Next we’ll watch for a test of the fib retracement at 1.2570 and the July low of 1.2457.

Monday, October 23, 2006

Still In A Holding Pattern

Price action in the EUR/USD pair all but evaporated today at the beginning of the New York session. The range for the session was only about 15 pips. That made it almost impossible for us to enter any trades. But with the data coming this week, we’re in no hurry.

More Consolidation Ahead of Data

The EUR/USD appears to be seeking its major support area during the London session. Analysts are unanimous in their opinion that little is expected from the pair prior to the release of the FOMC decision. Those entering the market now are trying to play the swings between support and resistance. Since we expect a range bound market, we’ll also try to work our 5 minute chart to scalp a few pips.

Sunday, October 22, 2006

FOREX Outlook For This Week

We expect plenty of volatility this week as the US government will release some very important numbers. Wednesday brings the FOMC rate decision. Regardless of the decision, we expect to see a good tradeable event. While the Fed is expected to hold the line on current monetary policy, investors will be monitoring the statement that accompanies the release for a clue on what the Fed might be doing in the future. The focus will be on whether the Fed has changed its opinion regarding the slowing US economy and ever present inflation.

Thursday brings more US data. Durable goods and new homes sales are expected to move the USD. The market is looking for these data to confirm a further softening.

Friday ends the week with US GDP data and the University of Michigan consumer confidence. Again we are expecting to see signs of what some economists are still calling a "soft landing" of the US economy. Any upside surprises will add that much more volatility.

Friday, October 20, 2006

Are You Ready For The Weekend?

After yesterday’s stellar day of trading, we look forward to a lackluster New York session today. With no major economic numbers being released, we expect the market to catch its breath today. And when you add next week’s FOMC meeting to the mix, we look forward to getting an early start on the weekend.

The EUR/USD has found support at the daily pivot of 1.2601 and there is very little volatility following the New York open. Look for the pair to meander today.

Thursday, October 19, 2006

Taking Profits

We have decided to take a 34 pip profit on the south side of our projected resistance. As we approach the close of the London session, we will watch for a clear break of resistance before taking another long position.

The Next Level

The EUR/USD pair appears to be poised to test resistance at 1.2615.  Look to go long today above 1.2560.

Wednesday, October 18, 2006

Defining The System

Defining The System (TEST POST ONLY)

The Scalper’s Trend Following System is based on variations of a TRIX system and a modified MACD. Our variation of the TRIX uses a short, medium and long term exponential moving averages as both signals and indicators. The modified MACD is used as confirmation.

A buy setup is generated when the short term moving average crosses up through the long term moving average. A buy signal is generated when the price closes above the short term moving average and the modified MACD gives a positive confirmation. An exit signal is generated when the price closes below the medium term moving average.

More Data

Yesterday saw both Euro Zone and US data move the market. We posted another profitable day using the Institutional Forex System. Look for another day of volatility (and profit) as more numbers are expected to move the market. Yesterday's surprise in the core PPI figures will likely have traders scrambling when the CPI numbers are released 12:30 GMT.

Monday, October 16, 2006

Calm Before The Storm

With no apparent trend in place, we look for another day of whipsaws. Daily studies appear to be bouncing off of July lows, and intraday action is muted. With plenty of economic data being released this week, traders may wish to take a less aggressive stance today. Starting tomorrow we have the British and Euro Zone CPI. US data includes the PPI and industrial production on Tuesday, CPI, housing starts and building permits on Wednesday. Add to that an FOMC decision next week.

Friday, October 13, 2006

Rally?

As hourly studies roll over to overbought, we will hope to catch a setup to go long. Current bias is up and price action in the EUR/USD pair has been bouncing around our daily pivot of 1.2554.

Thursday, October 12, 2006

Testing Support

The market has been in a steady down trend since the London open. We'll be looking for support at yesterday's session low of 1.2501.

Wednesday, October 11, 2006

Small Profits are Better Than No Profits

The EUR/USD pair spent most of the day in a tight range. Scalpers were able to pick up a few pips. For those using the Institutional Trading System, today's release of the September FOMC minutes gave us max profits. We also have initial unemployment claims (12 October) and retail sales (13 October) this week for another chance to profit from fundamental announcements.

Conflicting Signals

The current uptrend seems to be trying to catch its breath. Scalpers should look for a small correction to the 1.2630 level.

Tuesday, October 10, 2006


Taking Profit

As price stalled at the 1.2530 area, we booked a small profit. Our indicators are signalling a lack of momemtum and there is a possibility of a small bear rally. We will still look to sell into rallies as the short term indicators are currently oversold.

Ho Hum

Yesterday's market activity did not lend itself to any profitable trading. The EUR/USD remained in a very tight trading range. The release of some Euro Zone data this morning has moved the pair lower. As the bias is lower in all time frames, we expect prices to head south. We may try to sell into rallies today, but will be very cautious as the EUR/USD currently hovers in 'no-man's land' between the daily pivot of 1.2595 and Fibonacci support at 1.2450.

We'll be looking forward to tomorrow when the FOMC minutes are released. Although not as powerful as the actual rate announcement, people we pour over each word to assign some significance. If nothing else it adds volatility to the market.

Monday, October 09, 2006

A Slow Day

With holidays in the US, Canada and Japan, we expect a quiet day of trading. The EUR/USD appears to be retracing some of its loses from Friday and we will try to scalp a few pips today.
Look for a move above 1.2607.

Friday, October 06, 2006

Consolidation Frustration

We have been frustrated all week by the lack of direction in the market. We turned a paltry 11 pip profit this week. Considering the amount of whipsaw action we saw, we consider ourselves lucky.

Today is a 'Grade A' day according to the Institutional Forex System thanks to the US employment data being released 14:30 GMT. We'll hope to book maximum profit on the system trade this morning and then shut down for the weekend.

Thursday, October 05, 2006

Currency Trader Magazine

The October issue of Currency Trader is now available for download. Use the link on this page.

Waiting For Euro Zone Rate Announcement

The EUR/USD pair is poised to rise along with interest rates. We look to go long at 1.2718.

Tuesday, October 03, 2006

Resistance At 1.2760 Still In Play

We still see the market moving lower. Eye is on 1.2721.

Monday, October 02, 2006

Looking To Scalp The Market

The current high of 1.2756 has taken the EUR/USD into overbought territory. Our signal says we can look for a retracement to 1.2703. We will short this pair from 1.2737.